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Do creditors waiver interest on DMP

I've started a DMP with Step Change - 2 months in, about 24 more months to go!

However, I've just moved from a fee charging DMP to SC and was advised by SC that there is a possibility that creditors may add interest. If they did this it would take me longer to pay off my debts! Can anybody advise me how to deal with this. I have set my heart on being rid of the debts end of 2016. A couple of creditors have also sold on the debt to another company during this transition also, which is another worry with SC asking me to contact the company to find out to whom it's been sold on to... It feels never-ending!

Comments

  • Puzzcat
    Puzzcat Posts: 4,200 Forumite
    As a dmp is an informal arrangement the creditors do not have to freeze or reduce interest although most will once it's all in place. 8 out of 9 of mine have but obviously it can be reintroduced but I will cross that bridge if and when. You need to check your statements every month and keep your stepchange balances up to date as SC assume interest is frozen.
    If you pop over to the dmp mutual support thread, this is where the dmp' ers hang out and there is a template letter requesting freezing of interest if you need it. Try and read the thread as it will answer many questions you have not yet thought of!
    Good luck
    Christmas 2020 £109
    I love my dmp started in Nov 13 with SC. Self Managed 2016 57% done
    £60062/25384.84 - 13222.60k UE

    MY DIARY
    http://forums.moneysavingexpert.com/showthread.php?t=4768685
  • of our creditors all but argos have, virgin, halifax, barlaycard etc have, but we pay Argos £8pm and they add back on £5pm in interest...
  • sourcrates
    sourcrates Posts: 30,591 Ambassador
    Part of the Furniture 10,000 Posts I've been Money Tipped! Name Dropper
    If your debts are with original creditors, they can still charge interest, it depends on there individual policies.
    If a debt has been sold on, to a DCA, then there should be no more interest or charges added to the account.


    You can always write and complain to the creditor if you are not happy with the way they are treating you.
    I’m a Forum Ambassador and I support the Forum Team on the Debt free wannabe, Credit file and ratings, and Bankruptcy and living with it boards. If you need any help on these boards, do let me know. Please note that Ambassadors are not moderators. Any posts you spot in breach of the Forum Rules should be reported via the report button, or by emailing forumteam@moneysavingexpert.com. All views are my own and not the official line of MoneySavingExpert.For free non-judgemental debt advice, contact either Stepchange, National Debtline, or CitizensAdviceBureaux.Link to SOA Calculator- https://www.stoozing.com/soa.php The "provit letter" is here-https://forums.moneysavingexpert.com/discussion/2607247/letter-when-you-know-nothing-about-about-the-debt-aka-prove-it-letter
  • Gaia2014
    Gaia2014 Posts: 259 Forumite
    Tenth Anniversary Combo Breaker
    Thanks for the replies. Having looked at my statements it would appear the interest applied when the debt is still with the original creditor. The main one being the student loan company. The irony is I'm paying more to SLC on the DMP than I was before in terms of monthly payment. I'm worried my DMP is not going to finish on schedule because of this. I really need to be debt free by end of 2016 for so many reasons!
  • Deep_In_Debt
    Deep_In_Debt Posts: 8,579 Forumite
    Part of the Furniture 1,000 Posts Photogenic Mortgage-free Glee!
    National Debtline have a good template letter you could use to write to creditors
    https://www.nationaldebtline.org/EW/sampleletters/sole-letters/Pages/Freeze-interest-%28sole-name%29.aspx

    Good luck.
    Debt 30k in 2008.:eek::o Cleared all my debt in 2013 and loving being debt free :)
    Mortgage free since 2014 :)
  • National_Debtline
    National_Debtline Posts: 7,998 Organisation Representative
    Tenth Anniversary 1,000 Posts Combo Breaker
    Gaia2014 wrote: »
    Thanks for the replies. Having looked at my statements it would appear the interest applied when the debt is still with the original creditor. The main one being the student loan company. The irony is I'm paying more to SLC on the DMP than I was before in terms of monthly payment. I'm worried my DMP is not going to finish on schedule because of this. I really need to be debt free by end of 2016 for so many reasons!

    Hi Gaia2014

    Does your SLC loan date from pre-1997, then? I ask as more recent student loans would simply be recovered directly from salary.

    It is likely that more and more of your debts will find their way to DCAs as your DMP progresses - this is probably a good thing as far as the likelihood of stopping interest/charges is concerned.

    Dennis
    @natdebtline
    We work as money advisers for National Debtline and have specific permission from MSE to post to try to help those in debt. Read more information on National Debtline in MSE's Debt Problems: What to do and where to get help guide. If you find you're struggling with debt and need further help try our online advice tool My Money Steps
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